Myer shares dive as customers shut their wallets

Australia’s biggest department store Myer revealed its sales growth has ground to almost a halt over the past six months as trading conditions deteriorated after the RBA’s barrage of interest rate rises, sending its shares tumbling.

In one of the first trading updates by a major retailer this earnings season, Myer on Tuesday said sales just edged up 0.4 per cent in the June half after double-digit growth in the December half, limiting its total sales growth for the 12 months to the end of July to 12.5 per cent.

Myer had some of its strongest results in years in 2022 but sales growth has since slowed dramatically.
Myer had some of its strongest results in years in 2022 but sales growth has since slowed dramatically.Credit: Courtney Kruk

While net profit for the year will come in at $69 million to $73 million, up as much as 21 per cent, only $4 million to $8 million was generated in the second half, it said in a statement to the ASX.

Myer’s stock plunged 14.1 per cent to 61 cents in mid-morning trade.

The company will release its audited financial results in September.

Chief executive John King said Myer had been able to secure solid sales and profit growth despite the macroeconomic headwinds that hit the retail sector in the June half.

“We continue to tightly manage costs, inventory and cash to ensure we have a strong balance sheet as we begin [the new financial year], where we expect the ongoing uncertainty around the macroeconomic environment to persist,” he said.

Retail analysts are expecting further evidence of a spending slowdown during company earnings season this month, as national spending data reveals that households are continuing to reduce their expenditure to balance rising mortgage, energy and grocery costs.


The department store sector appears particularly vulnerable to a spending slowdown; turnover at the nation’s department stores fell by 5 per cent in June, according to Australian Bureau of Statistics figures.

Myer competitor David Jones has recently conducted an efficiency review of its store operations, which will result in up to 100 redundancies as the business looks to streamline its operations under new owner Anchorage Capital.

But David Jones chief executive Scott Fyfe told this masthead last week that he expects the consumer outlook to improve in the lead-up to Christmas.

Myer has emerged from the pandemic with strong trading growth over the past two years, and the company reported its best profit result in close to ten years in 2022.

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